Buying a new car (or a new used car) can be quite complicated and a little overwhelming. There are a lot of forms to complete, and that's just for the actual sale of the vehicle. The complexity increases if you're also trading in your old car or are getting a car loan.
In all the excitement about having a new vehicle and the flurry of paperwork that comes with it, don't forget about insuring your shiny new purchase. That's easy to remember if it's your first car or a car that you're adding without a trade-in. But switching insurance coverage to a new vehicle after trading in an old one is something that's easy to miss and can have serious consequences later on.
If not quickly remedied, failure to switch insurance coverage from your old vehicle to your new one can cause the loss of any insurance coverage on your new vehicle. That of course can be fixed if you realize the problem and secure insurance coverage for your new car before you have any need for insurance coverage. But that's an easy problem to miss because, without notice to the contrary, your insurer may continue to send premium statements for the coverage on your old vehicle as if you still owned it. That could in turn create the false impression that you have coverage on your new vehicle when in fact you don't.
The trouble arises when, assuming that you have insurance coverage on your new car, you make an insurance claim. Perhaps your car's stolen, you're in a car accident, motorcycle accident, or truck accident and need collision coverage, or, worst of all, you're at fault in an accident and find out that you have no liability insurance coverage for personal injuries to the other driver, pedestrian, or bicyclist or property damage to the other vehicle. That's when you find out that, after trading in your old vehicle, coverage wasn't switched to your new one and you're now exposed to potentially catastrophic financial harm and the other criminal and administrative license issues that an uninsured accident can cause.
So the moral of the story is to make sure that you buy new insurance for or switch your existing coverage to your new vehicle. If you have existing coverage on the car you're trading in, that policy may offer temporary coverage for your new vehicle. But don't delay officially changing your existing insurance coverage to your new vehicle. The grace period for notifying your insurer of your new vehicle and the need to switch coverage varies among insurers and can be as short as seven days. The issue of when coverage can be temporarily extended from an old vehicle to a new one, what type if coverage is extended, and how long that extension lasts is very insurer-specific. Please be sure to review your insurance policy or contact your insurer if you have any questions about that before you drive your new vehicle off the dealership's lot.
If you don't already have insurance coverage, either because you're buying your first car or are adding a vehicle without trading one in, make sure to shop for car insurance while still shopping for your new car. It's important for this purpose to have an idea of what car models you'll be considering so you can get an accurate insurance quote. You don't want to buy a new car only to find out that insurance coverage for it is unaffordable.
Please feel free to contact us if you need the assistance of a Des Moines insurance lawyer.